♪ gerri: hello, everybody. i'm gerri willis. tonight on "the willis report". the housing market and recovery. tonight the real realist a story. despite hundreds of regulations put into place by this administration to big to fail is still a real risk. we will tell you what it means

for you and your money. and one of the biggest names in fashion. supermodel here to kick off our series of special reports. "the willis report" is on the case. ♪ gerri: all of that and more coming up, but first, our top story tonight, the best news in american homeowners for more than six years. listen to this. our nation's real-estate market is seeing a real recovery. home prices seeing the largest gain since august of 2006 right before the housing bust. the index is up five and a half% year-over-year, and if that does not convince you the national association of home builders reporting the recovery has spread to more than 70 percent of 361 u.s. metro markets. that's a big deal. some of the things that got hit hardest by the housing bust a

loss vegas, phoenix, seattle are all coming back. still, some of the businesses are saying housing should not be looked at as investment. but i beg to differ. let's see what my next guest says. founder of the corporate group. always great to have you on the show. i want to talk to you about the comments. he says you can't think of the houses and investment. >> in addition to what he also said, you're better off renting out and buying. i think he's out of his mind and it's the worst advice you possibly give to anyone in the marketplace. first off, for everyone who is out there renting, they will go up like crazy because so much of the housing stock that was converted to rentals by investors is going to be a debt of the market now that prices have returned to my going to be flipped, and people will raise trends, so there is no security.

most importantly if i could just saone thing, ii live it, eat, breathe it every day, the emotional card that people have toward owning where they lived. ask anyone if they have the cash if you'd rather own it or pay to rent. people really want to own where they live, and that is not a trend, that is human nature, and that ain't going nowhere. gerri: dollars and cents. human nature, but am i going to make money? and look, i think people look back at the last six years. what they say is, well, the past is prologue. these housing prices are not going to go. gerri: that is not the case. the mood has switched. almost everybody that is surveyed believe they're going to pay more for that house one year from now. they are all right. tremendous fear in the marketplace that if i don't buy now i will pay more later. they're right again. so these are the emotional scars that are pushing the buttons that making housing prices go up by 5%. couple that with cheap money, plus the fact that the house is

up 30% cheaper than they were five years ago, why wouldn't you buy a house? gerri: it is interesting. of course, a yale economi, he does not know as much as people in the marketplace, regular americans are out there buying and selling each and every day. i want to talk to you about inventory because it is tight. one of the big things that has been promoting this really i selling price. not a ton of inventory. is that point to change? what is going to happen to prices and inventory finally does come full bore? >> the inventory is not going to improve. more inventory we have the fewer houses we have to sell, and nothing that fuels a buyer more than when they lose the house they bet on and that is a strict result of a shortage of inventory. that is not going to get better but worse. gerri: maybe you are talking to your book a little bit. here in real estate, 30 years. you love it. all people in real estate are

just born optimistic. are you overstating the case? >> you have to remember that i lived through three bloodletting realistic recessions and had to keep this going. i have lived it. you know what i learned about real estate that is very slow to unwind? taken us five years, once it starts spinning it's been so fast people know what hit them. from that experience i have to say this will be no different. gerri: my gut tells me that people are going to be the -- well, my gut tells me that people will be coming to me in twelvemonth and saying, i am so sad that i did not buy something. i wish i had. that was the perfect opprtunity >> very happy sitting in their rental paying their landlord little bit more. gerri: that will be bob schiller, not the rest of us. tell us more. brakes. the 30-year fixed. people are complaining because they're saying rates are going up. rates over time. >> the best thing that would take this market in a double

take would be a stitch up of a percentage point. all of a sudden the deadline on low prices, cheap money. wait until you see what that does. i don't think anyone is expecting that. that is not my value. of the people are predicting. gerri: individual markets because i know you have of you in some cities. >> new york city, and that, i have to say, i am totally biased and you should not listen to me at all. is the tree because i make my livelihood here. when i love about new york city and all the cities that are really international cities, there are not that many in the united states, san francisco, l.a. a bit, i love about it is there is always a new population of people moving in. so the japanese lose their yen value and move out, the chinese move in and take their computers of their hands, always someone, whoever is coming in. gerri: to see that more all over the country. all the foreigners buying in florida. so we're starting to see investors coming in the fall cash. foreigners coming in and out of

cash. individuals, first-time buyers, people who want to trade up. >> you know who is a person he should be moving even more than a first-time buyer or international person, someone who wants to trade up because if you take less for your home today and get them, this deep discount to you are ahead of the game. people are still stalling when they should not be. gerri: named three cities that you like now. >> seattle, las vegas and first and foremost new york city, my home town. gerri: so good to see you. the key for coming on. appreciate it. now we want to know what you think. here is our question. do you consider your home and investment? log on to gerriwillis.com, vote on the right instead of the screen and that will share the results of the end of the show. from new york all the way to california. houses are selling again. buyers are finally returning to the market, especially i los angeles. fox business robert gray joins us from hollywood hills

california with an exclusive look at a great home for sale. i hear leonardo dicaprio and have a very are there. have you met them? >> not yet. i am still waiting for the invite for a picnic for something. a great screening room downstairs for are a dozen or so of your closest friends. i'm told shields two or three properties adjacent to this one in the trendy birds street area. called nightingale, bridgeway is down the way. i always thought that was a beatles song, but there are other back story to that as well. clearly we have seen a los angeles market hit hard during the recession, tumbled by more than 40 percent according to the case schiller index, bouncing back off lows. the upper end, luxuriant, and standing in now is all the way back at pre recession levels. sold more 5-million-dollar home-plus years ever. part of that to my aunt told, folks trying to sell because

capital gains prices are going to go up because there is not a lot of inventory. but a lot of inventory. coming from china, russia overlookingthe pacific ocean, not too far from here, just weeks ago. still gabbing headlines. a record sales for the area and in international buyer who did not wish to be identified. folks coming in from france. we know what is going on there with sarkozy fleeing the country because of the higher tax rates. this sum will set you back 7500 square feet. it's going to go for about 13 million as the listing price. of course five bedrooms and saw the screening room. the pool, hot tub, views of downtown, but if you come over here we can take a look and you can see the glasses encased masters week and, of course, you

wake up every morning with a view of santa monica and the pacific ocean. gerri: that is gorgeous. ha you put a bit in? >> i guess it is worth every penny if you have them. i don't know. gerri: it is pretty. amazing property. thank you for bringing it to us and we appreciate it. >> you're welcome. gerri: special coverage of the real-estate story continues thughout the show. and 20 minutes i will be joined by a famed real-tate agent. she will give us a peek inside as $16 million penthouse for sale right here in new york city. there we are. a warning to congress that another financial crisis could be around the corner if we don't get rid of too big to fail once and for all. details next. ♪

officemax is celebrating our new collaboration with go daddy! with an online package including: domain name, website builder with five pages and basic email just $49.99! that's up to 76 percent below online providers and only at officemax stores! spending the day with my niece. i don't use super poligrip for hold because my dentures fit well. before those little pieces would get in between my dentures and my gum and it was uncomfortable. even well-fitting dentures let in food particles. super poligrip is zinc free. with just a few dabs, it's clinically proven to seal out more food particles so you're more comfortable and confident while you eat. so it's not about keeping my dentures in, it's about keeping the food particles out. [ charlie ] try zinc free super poligrip. we asked total strangers to watch it for us. thank you so much. i appreciate it. i'll be right back.

they didn't take a dime. how much in fees does your bank take to watch your money? if your bank takes more money than a stranger, you need an ally. ally bank. your money needs an ally. it's delicious. so now we've turned her toffee into a business. my goal was to take an idea and make it happen. i'm janet long and i formed my toffee company through legalzoom. never really thought i would make money doing what i love. [ robert ] we created legalzoom to help people start their business and launch their dreams. go to legalzoom.com today and make your business dream a reality. at legalzoom.com we put the law on your side.

♪ gerri: watch out, taxpayers, you

could be on the hook for yet another too big to fail bailout. that is the message top bank regulators and lawmakers are sending. they say dodd-frank fails to protect your bottom line. joining me now, director of financial affect -- financial regulation studies indicate institute. tell me, you said current regulations, we could end up paying for yet another bailout. i have to tell you, all the democrats in washington say you are wrong. what don't they know? >> well, i sent a -- i think they want to defend the act of the past, but the evidence is is too big to fail this year, the largest bank should be able to borrow at a lower rate than rivals. midsized and small banks, and if you looked at the data it is clear that they can. it was not that way before the crisis. big banks did not have an advantage. again, i do think that the democrats on the hill, the administration was to sell you on the dodd-frank works when it clearly does not to read -- gerri: here is something. he said the limits dodd-frank

puts on the fed rescue authority is largely cosmetic. what do you mean? >> absolutely. the change that congress did, it said, if you do any bailout programs from now what needs to be widely available and everyone should have access to it within a certain category, but it completely leaves it up to the fed to define that category, so it is like saying everyone is available, but you need to be 6-foot even define this in a way ben wright did write. -- it very easy not say for my time working and the help. i'll admit that i crafted compositions here and there in the law there were only going to be targeted to one company. all the time. i'm skeptical that it will work that way. they're so much work. gerri: here's my question.

here's my question. if you believe that we have been drained to big to fail, and it absolutely exists and we could be on the hook all over again, the next step is to break up the banks. how'd you do that? is seems just completely impossible. wall street will oppose you. the banks are going to oppose you. big industry will probably oppose you generally. how could that possibly happen? >> there is certainly a lot of political obstacles, and that is what i think we have to keep in line with too big to fail. too big to fail is far more a political problem that it is an economic problem. once you set up the expectation that government will bail you out if you're too big or too complex, you have an incentive that to become big and complex. and i think what we really need to do is tie the hands of the regulators and a big way, take the ability of the federal reserve to bailout anyone, not just one institution for bob -- broadbased bailouts, restrict that to restrict the treasury ability to go something like a stabilization fund was the use

to bailout of mutual funds and bail out the banking industry, you have to take that pots of money away from the regulators. as lawyers they have a big pot of money. gerri: responsibility for their own operation. the banks have to know at the beginning of the day, if you do something stupid your going to have to pay for yourself because the taxpayers are coming to value out. as the answer to the question. >> absolutely, and if they know that they will change. if you believe in, they had ten different offers to be bought. he said everytime, i will take less than $10 a share. you create the expectation. therefore he acted to put himself in a bad situation. if he said of the expectation that if they mess up there will fail and will not get bailed out, there will therefore on narrow range of businesses in a way that they know there will be less likely to fail, so the real problem is knowing that that satanism beneath the banks it

makes it riskier. gerri: i agree with you 100 percent. gerri: coming up next, more special coverage of the real real-estate story. albrecht on the pros and cons of the housing market right now and why you should not let recent history scare you away. stay with us. ♪ the capital one cash rewards card gives you 1% cash back on all purchases, plus a 50% annual bonus. and everyone likes 50% more... [ midwestern/chicago accent ] cheddar! yeah! 50 percent more [yodeling] yodel-ay-ee-oo. 50% more flash. [ southern accent ] 50 percent more taters. that's where tots come from. [ male announcer ] the capital one cash rewards card gives you 1% cash back on every purchase plus a 50% annual bonus on the cash you earn. it's the card for people who like more cash. 50% more spy stuff. what's in your wallet? this car is too small. did you know not all fiber is the same? citrucel is different-

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♪ >> there are lots of opportunities in the housing market, and you should not be sitting and the sidelines.

gerri: at like to say it over the housing bus, but not. i'm still angry, angry at home

buyer sued over bought for closed banks and give out loans to anyone who could fight a mirror in the government regulators you just sat idly by. for me it is personal. my home's value is still suffering. here is the thing. when it comes to your money you have to set a motion -- set in motion aside and be clear and it home prices are up nationally five and a half% year-over-year. that is the largest gain since august 2006. median home prices have gone from a low of 156,000 to almost 181,000. what's more, 70 percent of the nation's three and 61 metro markets are in recovery of 3% from september 2011. schiller reports that 12 months ending in november prices rose in 19 of the 20 cities it tracks. only new york was lower. the onetime housing bust loser, phoenix, saw prices rise 23% in 20 months, 23 percent as it

posted its seventh consecutive month of double-digit returns. in the washington the market is red hot with some agents reporting bidding wars and half of the cells that make. this is enjoying its highest population of 45 years thanks to e blood of our federal government. and in austitin, texas, first-te buyers are playing catch up with rising prices as expanding jobs let that market. it is becoming clear we're at the start of what may become a real real-estate recovery, the best is american homeowners have had in six years. let's stay together, yea. about time. here is the deal. the downside to the upside the you need to know before you get excited is this, the gains particularly in prices a bit edgy because inventories constrained aslope, much of the sales of the past two years have been foreclosures , damaged properties to mark down to the bargain bin. buyers have been professional stock foreigners, people who can afford to put-down.

back in california third of all properties are paid for in cash. but that all means is so far we are not back to the usual market in many parts of america. the first of all meyer is eager but not dominating the market. the move a buyer is still silined because they're still under water. i like real estate and that the card as it's going to be a good place to be over the next several years. here is my advice to my right. make sure you are not overpaying in many bubble formed by russian investors are flippers inspired by di why networks. get the facts, he rid of the motion, and make a great investment. when we come back, should checking your blackberry at home be considered overtime? next, a real-estate special continues as we go inside a $16 million new york city penthouse for sale. plus, find out the hottest housing markets in 2013. ♪ uh, i'm in a timeout because apparently

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reporting on the return of the housing market. newark's city market is booming one selling at $10 million. dolly took us on a two or of one home and shares of great advice of many a price point*. >> you've been in the business 25 years. is this a recovery. >> not full-blown we will still have surprise is possibly negative. if we don't get our employment act together with the prospect of jobs, if they think they will lose their job, most people are

not buying homes. gerri: jobs and housing are linked no doubt about that. who is buying? >> everybody. movie stars, athletes company in the chinese, russian, everywhere wants a bite of the big apple. gerri: this apartment is swanky whether they're looking for? >> primarily location and location location. primus fifth avenue commandeer all private schools simic said jackie o. reservoir and she lived right there. in the middle of everything wonderful. gerri: who lived here? >> mariah carey, rush limbaugh, he had a similar

apartment a couple floors down, we have had many celebrities in the building. gerri: and you have a vice? >> be careful. the right price, the right property, that you are not dealing or you lose. have a long time horizon. gerri: this market, you have specific advice? >> don't rush with a second bid, don't fall in love, and make it a match deal. gerri: $60 million. >> this is a bargain, at i have been to parties here over 100 people with a table set up and it was going.

gerri: i have never received -- a scene in eat-in kitchen >> it is comfortable. >> with the window. >> master bedroom, the owner is very tall. [laughter] >> also a second bath. >> right across from each other his theaters. if you got the 30 year mortgage, 4% interest, you are paying $60,000 a month does none include taxes are monthly charges then it is 70,000 per month what particulars are they looking for? >> sap profile, families,

profile, families, children, pets, a lot of buildings are not pet friendly. >> this does have a restriction the size of the dog in the number of dogs. gerri: under a certain weight? >> maybe 40 pounds. >> my dog would have to go on a direct. this is beautiful. >> thank you. gerri: market and to its own that cost over $10,000 per month in taxes before you touch the mortgage. home prices are skyrocketing with some areas seeing bigger booms. number five, austin, texas. with the highest job growth rates in the country with more than 21 construction

permits per 1,000 people. number four, san antonio. median price per square footage $88. one of the fastest building countries -- cities. number three less than three homes in foreclosure for every 1,000 units in maryland. number two san francisco prices are already high up nine point* 5% since 2011. number one, houston texas the highest job growth rate in the country, business and commercial real-estate booming. seattle, omaha, louisville seattle, omaha, louisville, let's just move to texas. stayed tune for lou dobbs

and a deal could go for the real story on real estate. the father on the toyota pre-is comes down on electric cars in chicago officemax is celebrating our new collaboration with go daddy! with an online package including: domain name, website builder with five pages and basic email just $49.99! that's up to 76 percent below online providers and only at officemax stores!

[narrator: female] quiet please. wait a sec. i'll take one. oh yeah. alright. all good. take care. way to go. nice. bring it on. gotcha i'm here for you. oh no. please, please. please. i'm waiting. interesting... not buying it. not fair. that's it. this conversation is over. oh, brother. [narrator: male] body language can tell you all sorts of things. [narrator: female] i'm having a stroke. i'm having a stroke. [narrator: male] know the sudden signs. learn f.a.s.t. f- face drooping a-arm weakness s- speech difficulty

t- time, time to call 911 immediately. the sooner they get to the hospital, the sooner they'll get treatment, and that can make a remarkable difference in their recovery. learn the bo language, the sudden signs, and spot a stroke f.a.s.t. gerri: is the electric car losing its charge? despite the push from the white house, it is hitting a dead end with consumers and former high-ranking supporters. robert, a great to have you on the show. we call to because the big toyota executive said it is not a viable replacement for most conventional cars for a wish somebody told the department of energy that. >> he repeated something

that has been well known for years and should have been known with the obama administration the electric car is the next big thing it has yet to replace the internal combustion engines because of cost, range and value. gerri: where do you go to recharge its? so many practical issues not taken into consideration but there were benefits for these at what point* do we say get out of the private sect? >> great point*. a bureau chief i detroit made that point*, the reuters article that you are referencing, a the public's

indifference. [laughter] it is such a great wine. the numbers last year nissan thought they would sell 20,000 of the knees on the if but they sold 10,000 but ford sold 60,000 of the f-series pickup they sold more pickups in six days than nissan sold in one year. [laughter] gerri: the president wanted to put those cars on the road but no such luck. but now you are writing about wind energy? >> last week "wall street journal" i talked about fish and wildlife service is

charged with protecting america's wildlife, is contemplating giving a permit to allow a project in minnesota to kill all the goals. gerri: what are you talking about? >> nor can hunters it is a fine of a quarter of million dollars, it is a national symbol, the great seal since '72 but fish and wildlife service under direction has not prosecuted though we in the industry one time all they estimate 400,000 birds are being killed and nine golden eagles have been killed in sort -- southern california. gerri: this seems crazy. if i cannot kill one neither should the wind industry.

>> exactly. in this case the interior department has created favored class of energy producers. the ada to give a permit to kill a bald eagles and now it could last 30 years there has been a remarkable backlash for the third year permit the groups that have been united and it is a bad idea it should be killed. gerri: have a great weekend. you ever wish you could be paid for checking werke males at home? chicago cops have a lawsuit claiming the city owes police officers overtime for

work performed after duty and of these meal has this case it sounds like a union problem. >> right. that many say we go home in greece still get these urgent e-mail's we feel we have to respond. but the police have a policy that say if you do spend a lot of time, you can apply for overtime. they say it was a culture we should not apply but the policy says they can and will be paid. gerri: everybody can relate because people are told to work for free. >> i don't agree they are a salaried employees.

we will check our blackberry , that is part of the job to make sure we're in communication. it is a time saver we don't have to be in the place, doing legal research from these devices. if you really don't want to be in communication, i turn it off. [laughter] gerri: i had no reception. you are an attorney you bill 30 hours per day. >> a bill in six minute increments if i think about you in the shower, that is a six minute increments there is the portal to portal act

restart where you get to work you cannot bill for that time but lawyers can bill for that time. gerri: and you are to sneaky [laughter] have a great weekend. on this day in history, 1971 the nasdaq open for the first time a computer bulletin board system, the first day of trading the nasdaq system traded more than 2500 stocks and helped deliver the spread. today the composite index has a stock of every company including apple, of this book, microsoft, e. bay, it has more trading volume than any other electric stock exchange in the world in a

market cap of four point* $5 trillion. in your city is open today, a figure eight, 42 years ago. new york city turning into a nanny state and an icon in the industry iman joins me. the industry iman joins me. don't at a dry cleaner, the industry iman joins me. don't we replaced people with a machine. what? customers didn't like it. so why do banks do it? hello? hello?! if your bank doesn't let you talk to a real person 24/7, you need an ally.

hello? ally bank. your money needs an ally.

gerri: in fashion and new weekly report profiling the entertainment industry the first guest is a super model turned a businesswoman and a one time for sludgy and calvin klein and built the entire empire herself cosmetics, home decor and clothing and accessories fishy will sw tonight. of fox business exclusive interview, a iman. >> welcome. >> i love this set. >> our viewers know you and have watched you and i think

of the first model something else and go into business. what is your inspiration. >> a new it was a business with a short shelf life so what is next? instead of waiting for things to happen that is how it came up bought -- about. first it was cosmetics from my heart and passion is fashion. gerri: we will get to the products but those years, on the runway, magazine covers covers, you last modeled 1996 which seems impossible.

>> is as glamorous as they say but a lot of hard work, a lot of traveling, you don't build relationships or french ships and less in the industry because you're constantly traveling. but it is funded very glamorous. gerri: this is your own empire what about the line? >> five years ago ceo of home-shopping network came to see me to create a brand because i believe women cannot have enough accessories. so slowly to build fashionable designers and

brands. so we have global check and the platinum collection it is all under $100 you can wear it to right now to look like the best of them but less than $100 the platinum collection is higher and the best of leather and suede and for, a very, very sophisticated. gerri: what about your web site? >> destination iman.com everything fashion fashion, accessories, home fashion, accessories, home, children, aged well, take care of yourself, this month's issue we celebrate new york fashion week so we

cover that so i will send my staff there. gerri: we can follow life and times by going to the web site. your products, the necklace necklace, the about this. >> this is exactly what this is, but you can wear it with addresses, t-shirts, a point* of interest. gerri: yours is beautiful. >> this is sold out hsn.com. gerri: i cannot believe what people spend on bags. white you think they are important? >> you canut color into

your wardrobe it is an easy way. with calibrated is and 100 percent leather and less than $140. it is done in an and forgiving. i cannot live without a trenchcoat but this is a lor block with a trench. gerri: you have designed erything. >> exactly. >> what part of the world had you not tackled? >> new zealand. that is next.

gerri: great to have you. we will be right back with the answer to the question of the day is your home and investment? the capital one cash rewards card gives you 1% cash back on all purchases, plus a 50% annual bonus. and everyone but her likes 50% more cash, but i have an idea. do you want a princess dress? yes. cupcakes? yes. do you want an etch-a-sketch? yes! do you want 50% more cash? no. you got talent. [ male announcer ] the capital one cash rewards card gives you 1% cash back on every purchase plus a 50% annual bonus on the cash you earn. it's the card for people who like more cash. what's in your wallet? i usually say that. it's delicious. so now we've turned her toffee into a business. my goal was to take an idea and make it happen. i'm janet long and i formed my toffee company through legalzoom. never really thought i would make money doing what i love. [ robert ] we created legalzoom to help people

start their business and launch their dreams. go to legalzoom.com today and make your business dream a reality. at legalzoom.com we put the law on your side.

gerri: robert schiller declares housing is not an investment. i disagree. what do you think? >> no. it is where i live, nothing more. >> better than the stock market even with the reduction, housing will make a comeback. >> 71 percent say yes. 29 percent say no. >> talk about america being unsafe, not the number of guns were americans who own them but the dollar, a debt and weak foreign policy. unemploy